NYC Sushi Restaurant's Ban on Tips Perplexes Diners

Sushi Yasuda has made headlines for its mouth-watering sushi and excellent service for more than a decade, but the restaurant is getting noticed now for a different reason: banning tips.

"The diner doesn't [have to] think about how much to leave and make calculations [after] a contemplative and special meal," co-founder Scott Rosenberg said. "We're really sort of just staying connected to that classical approach [of fine Japanese dining]."

In keeping with the pared-down aesthetic of the business, owners of the New York City restaurant earlier this year decided they would no longer ask patrons to do any complicated math at the end of the night.

Instead of relying on tips, all their servers are on salary with paid vacation and sick leave.

Rosenberg said the goal was to enhance the restaurant experience for customers.

The high-end restaurant, which seats only 45 and where the omakase, or chef's menu, can easily run beyond $100, also raised its prices slightly to allow for servers to be put on salary.

(Image Credit: Courtesy of Sushi Yusada)

Daisy Chung, executive director for Restaurant Opportunities Center of New York, a nonprofit that supports restaurant workers, said she thought the practice of banning tips and providing a salary with benefits was a "good idea."

"It started a good conversation about tips and restaurant compensation," Chung said, adding that inclement weather, for instance, is something that deters diners and thereby limits tips no matter how good the service.

"We definitely feel there shouldn't be a separate system where tip workers rely on tips to subsidize their wages," Chung said. "Workers should be fully compensated."

None of the staffers at Sushi Yasuda was available to comment and it's unclear how much they make in salary.

Banning tips can also smooth the process on the management side of a restaurant, said Andrew Moesel, spokesman for the New York City chapter of the New York State Restaurant Association.

"It also can be easier for the house," Moesel said. "Wage and tip lawsuits are on the rise, since rules are becoming increasingly complicated."

Moesel knows of no other New York City restaurants that have banished tips, but he said the practice has gained traction at other high-end dining restaurants, including a few in Chicago where the entire meal is paid for beforehand.

"Whether or not this is a culinary trend, this is something we're seeing more of," Moesel said.

Rosenberg said one of Sushi Yasuda's biggest challenges was explaining to customers that they could no longer tip. They put a note in both the menu and receipt explaining that customers did not need to tip, but many patrons were still bewildered.

"They'd look up at dinner partner or partners and say, 'There's s no tipping'" Rosenberg said. "[There's] a moment of [people saying], 'Wait a minute, what?' And then, 'OK, that sounds good.'"

A few customers still tried to write in a tip on the receipt, even though there was no longer a tip line. The restaurant eventually started circling the explanation on the receipt in red to draw the customer's attention.

Rosenberg said that once customers realize they don't have to pay a tip, they are usually delighted.